Research how HVAC impacts your sustainability initiatives and the pitfalls to investing in savings.

Your commercial office is the next Target for hackers – Part: I

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We researched how hackable building automation systems are in Sacramento and the results are surprising!

By: Zach Denning

 

I’d like to preface this article by stating that during our research we reached out to every building owner that had vulnerabilities with details of information we discovered – All without cost to them and without the expectation of future work.

At no time did we attempt to login or ‘hack’ a building automation system – We simply tested these networks for vulnerabilities easily exploited by hackers.

It’s our initiative to secure sites where our HVAC Partners implement our software platform while educating owners of vulnerabilities relating to building automation.

 

“My HVAC contractor told me that if he has remote access to our building service calls are half-priced. All we have to do is connect our building automation system to the Internet and we can save hundreds every month!”

And just like that your office building is now part of the ‘low-hanging fruit’ every hacker dreams of getting access to. But it’s just your HVAC system. All they can do is turn the temperature up and down, right? Wrong.

At least 65% of all building automation systems are connected into existing building infrastructures via hardwired, Ethernet connection. Unfortunately, most offices don’t properly segregate the building automation from the same network as their tenants (Typically done through a VLAN or virtual separation of physically connected networks) as it’s costly to setup and maintain.

Meaning a virus enters your network via the building automation and can jump or ‘springboard’ from tenant-to-tenant at will – Return vital information back to its host (Account numbers, logins, credit card numbers, etc.) like the Target hack. But you’ve been told your building automation is secure – You’re behind a firewall – It’s only Bacnet – This will never happen to you – Wrong!

We researched how secure building automation systems were in Sacramento and found –

 

  • There are +300-different building automation systems openly exposed to the Internet without a firewall.

    Of the 82 systems tested, we found 18 had default admin user credentials where there was an ability to login to the automation system and get full access to override the system, change setpoints, schedules, etc. More importantly, admin permissions included unrestricted access to the file transfer protocol features which is pivotal for – You guessed it – Uploading a virus!

  • 114-different building automation systems behind a secure firewall with the Bacnet IP port (UDP:47808) exposed.

    Despite being open to the Internet, the building automation systems at these sites were nested behind extremely capable firewalls. Unbeknownst to the building owner though, the HVAC contractor had accidently enabled the Bacnet IP traffic on their front-end hardware – Enabling full access to all control setpoints and the ability to springboard viruses onto their network.

Wait, I thought Bacnet IP could only be used for HVAC-related data? Wrong again.

Bacnet IP is a communication protocol built on the foundation of HVAC communications with one slight caveat – It allows for open file transfer! In developing our Bacnet driver, we discovered that most Bacnet IP-enabled devices will accept a file transferred from our IP-device if it matches a certain criterion of name, type, size, etc.

All a hacker has to do to upload a virus to your building is –

 

  • Scan the building automation system for file types
  • Create a new file with one of the discovered types and infect it with a virus payload
  • Send the file to the building automation device

 

Even when the device rejects the new file, the originator can keep changing file types until one is accepted (i.e. – configuration files, history files, etc.). From there the virus springboards to every connected device on its network – Infecting as many files as possible, collecting information and reporting everything back to the host.

So how do you prevent hackers from getting into your network?

Check out Part: II of this post next week to learn more and see how much it costs to not secure yourself!

 

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’ve developed an HVAC AI software platform that strengthens relationships between service providers and property management, while reducing operating costs 18-22%.  You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

Your building is smart – And so are squirrels!

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3-reasons why your building is dumber than you think and what you can do to fix it

 

By: Zach Denning

The biggest technological fallacy for the last 3-years in commercial buildings is how HVAC systems fit into the “Smart Buildings” bubble. HVAC and building automation manufacturers have plagued the market with overhyped marketing and underdelivered results on the foundation of buzzwords like “analytics,” “machine-learning” and “smart.”

So what is actually installed in your building and is it really “smart?”

Smart HVAC controllers/sensors: IQ Score – 5

The latest addition to the Smart Buildings market has been the insurgence of smart sensors and HVAC controllers – “IP-enabled” being the core-feature at the forefront of the movement. Because which IP-based devices aren’t smart, right?

Here’s a list of IP-enabled devices that are smarter “out-of-the-box” than their HVAC counterparts –

  • Smart diapers
  • Smart couch
  • Smart fridge

… I think you get the picture, but how is a smart diaper more intelligent than your IP-sensors?

Although IP-enabled devices aren’t exactly cutting-edge, the commercial HVAC market typically lags 8-10 years behind most technology-based industries. There are numerous documented issues surrounding IP in HVAC including security, installation, maintenance, etc. – All leading to it’s snail-paced entrance into the built environment.

Not to mention, there’s typically little monetary gain by adding IP-based technology in HVAC as any added value is underutilized by the corresponding software – Which is heavily customized by the installing contractor and relatively unusable/unserviceable post-install without serious re-development.

Equipment manufacturers have also leveraged into Smart Buildings by pre-packaging equipment with new onboard sensors and controllers – Each offering new insight into equipment operation and servicing. Unfortunately, analyzing one element in a complex, multi-tiered system lacks the value generation necessary to overcome the added investment.

Imagine paying an extra for $500.00 for a smart steering wheel versus a fully autonomous car – I’d rather have one comprehensive solution than an alarm when I’m not at ‘ten-and-two.’

Building automation systems: IQ Score – 25

In recent years, many articles have cited onsite engineers noting the only difference between pneumatic, air-controlled HVAC systems and electronic systems is, well, air – Despite the fact that pneumatic technology is +50 years old.

Even worse, the same staff didn’t see a difference between building automation and a time clock – So where’s the intelligence?

Digging deeper, engineers have exposed the ability to remotely access their HVAC as justification to upgrade from older pneumatic systems. Not a bad start, although it’s the equivalent of using IBM’s new Q quantum computers to surf the web – I don’t see anyone paying $1,000/sec to stream NetFlix anytime soon!

Most building automation installations utilize less than 8% of the total system capacity necessary to maximize operational efficiency. Even worse, capacity is often eroded by nearly 40% annually through third-party interaction and modification.

Ultimately, your brand new $5.00/sq. ft. “smart” building automation system has less intelligence than the RainBird irrigation system you installed in your backyard – Three years from now it’ll be comparable to a simple light-switch!

Analytic software platforms: IQ Score – 35

“Analytics” and “machine-learning” have gained the most notoriety as buzzwords in the HVAC Smart Building space. New platforms emerge monthly that promise to solve all your HVAC problems and alleviate tenant complaints – Of course they’re smart, right?

We’ve collectively seen five-different analytics platforms installed in three-different market verticals with zero end user engagement or measurable outcomes – Equating to an extra 25-30% in upfront building automation capital requirements and no monetary gains – How could this happen?

Analytics platform developers constantly market the ability to implement cutting-edge, machine-learning algorithms capable of driving massive savings. I have the ability to become an astronaut. It may require 10-years of strenuous physical and mental development, coupled with a 1% chance of success – But who’s to say I don’t have the ability!

Furthermore, most platform developers rely on partner channels to develop and implement algorithms designed to drive actionable intelligence to end users. Unfortunately, 75% of all partners don’t employ software developers and rarely have the knowledge to implement anything beyond real-time alarms – Equivalent to the tire pressure alarms in your car.

Even in the most advanced implementations, HVAC analytics software deliver little actionable intelligence designed for financial decision-makers. It’s one thing to find a broken part- It’s quite another to validate that incident to a non-technical decision maker.

When’s the last time you rushed to a mechanic when your check engine light went off? Now imagine your check engine light –

  • Told you the problem was your air filter
  • Was costing you $25.00/month in gas
  • Was only $50.00 to replace

Oh, and here’s a local certified mechanic that specializes in Hondas less than 2-miles away – That’s true actionable, financial intelligence your system lacks!

Maybe you choose to ignore the check engine light, but not without significant guilt. Moral of the story, all intelligence isn’t created equal and your platform probably lacks any.

How to avoid the pitfalls of “smart” building technology!

If you consider your building “smart” and it falls under any of these categories, there’s still hope to increase its IQ. Next time you invest in building technology answer these simple questions –

  • How does this technology drive my bottom line and does the installer have proven results in a similar application?
  • How do you plan on maintaining the technology post-installation? In house? Outsourced?
  • Can the technology communicate actionable intelligence across my entire corporate hierarchy? Can the CFO glean valuable HVAC investment insights? Will your engineers know when and where components are failing?

The high-tech landscape of the HVAC market is evolving – Unfortunately marketing has a big head-start on actual technology!

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’ve developed an HVAC AI software platform that strengthens relationships between service providers and property management, while reducing operating costs 18-22%.  You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

Three things to know before investing in an “intelligent building”

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Intelligent Building - Ideas for your next intelligent building

Intelligent buildings are the future but what does “intelligent” actually mean? How do you guarantee savings from smart building technologies? Are all building technologies created equal?

Intelligent buildings are the future – Find out if they should be in yours!

By: Zach Denning

 

Technology has evolved dramatically in the last fifteen years. Cell phones have evolved into “smart phones” and laptops have been replaced with tablets. The last industry anyone would consider being linked to the tech bubble would be HVAC – Laggard, maybe. Left out, certainly not!

HVAC technology investments in commercial buildings account for nearly 2.00/sq. ft. and comprise of microprocessors, IP enabled gateways and thousands-of-lines of coding. Intelligent buildings have the ability to network HVAC equipment with the intent to maximize energy savings and reduce maintenance costs.

With the building technology market growing larger, some providers are making astronomical claims that may leave your building with a single digit IQ.

 

Here are some ideas to consider before investing in your intelligent building project:

 

1. Cost-saving advantages touted by technology companies typically require 3rd party setup

Building automation systems (BMS) manufacturers argue energy and maintenance cost-savings as a benefit when considering upgrades. Although most systems are capable of substantial reductions the real savings are in the programming or coding – Not the hardware itself!

Even configurable systems still require a competent 3rd party programmer or technician for proper setup. The “intelligence” in intelligent buildings typically revolves around the actual coding or programming of the hardware.

Imagine Apple releasing the first iPhone without a single App and touting that it will reduce your business overhead by 30%! Although a great platform, even the iPhone would still require talented developers to scratch out code in order to make these lofty claims.

When investing in a new intelligent building platform ensure that the 3rd party integrator can guarantee claims made to you by the manufacturer.

 

2. Maintenance cost-savings require your service provider to understand technology

At least 30-35% of the total cost-savings associated with intelligent buildings are in maintenance and operation. Commercial HVAC operating costs are traditionally 60-70% energy and 30-40% maintenance.

Although some HVAC audits omit maintenance savings as part of their returns they have a profound impact on returns. Relying soley on energy savings as justification for an intelligent building can almost double simple payback – Inclusion of maintenance savings can drive payback down to less than 2-years!

HVAC service providers capable of interacting with building technologies can reduce total operating costs as much as 21-24% annually  – With tenant complaints dropping almost 50%! Make sure your maintenance provider knows how to work with your new system to ensure you hit your savings goals.

 

3. Ongoing service is necessary for ongoing savings

Intelligent building technologies are often incorporated into sustainable investment strategies – Although they lack sustainability as standalone investments! Systems like building automation and analytics must be constantly maintained and tuned by a certified 3rd party to ensure ongoing savings and efficiency.

Investments like building automation should include costs associated with life-cycle maintenance in order to get accurate return data. Unlike solar or other energy-based investments, the “one-and-done” mentality can have massive impacts on return calculations.

The average HVAC system degrades at a rate of 12-15% annually which must be accounted for with ongoing maintenance and monitoring. Inability to quickly resolve lingering issues leads to high-cost failures and tenant impact.

Ensure your service provider includes specific details about maintaining your intelligent building investment – It’s worth it!

 

Understanding and implementing the above ideas on your next intelligent building investment will help safeguard expectations and calculated savings. If you have any questions or ideas on upcoming projects feel free to shoot us a call and one of our engineers will be happy to help!

 

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’re an HVAC engineering firm that utilizes cloud-based technology to bridge the technical and financial gaps commonly found in HVAC management. Our OCMS EnerVise platform keeps customers knowledgeable about their building including HVAC life-cycle costs, forecasted maintenance & upgrades, and equipment replacements.   You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

OCMS; Building Operating Cost Management

Traditional HVAC budgeting is costing you tenants and destroying your bottom line

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Replacing and upgrading HVAC has been traditionally based on outdated methods that could be hurting tenants and your bottom line!

Strategies for investing in HVAC with maintenance, upgrades and replacements is evolving beyond visual inspection and estimated industry life.

Strategies for investments in HVAC like maintenance, upgrades and replacements are evolving beyond visual inspection and estimated industry life.

 

By: Zach Denning

We’ve all been told that once your car odometer flips 200k it’s time to start looking for a new car. Based on industry research, large parts like engines and transmissions begin to wear down and the risk of catastrophic failure increases exponentially – Or at least that’s what you believe.

We live in a world of information, yet traditionally, most has been inaccessible or lacked actionable-intelligence until now. Think about how investments in our car would transform if next time you went in for an oil change your mechanic told you the total operating cost savings of replacing air filters or changing belts? You’d probably be more inclined to dip into your piggy bank knowing there was a 2-3 month timeline for return.

What if instead of just real-time MPG, cars showed you MPG degradation over time? Even more, cars tracked maintenance and gas bills to show your total cost of ownership and how efficiently you operated and maintained the vehicle? You would begin thinkinng about replacing your car based on metrics like Return on Investment (ROI) and risk of parts failures (Excluding the leasing crowd) rather than industry averages and routine inspections.

Like cars, HVAC wears down over time. But the difference is HVAC equipment contains the data necessary to establish operating degradation and deliver actionable-intelligence on when, how, and why you should invest. Owners and managers have traditionally relied on tenant complaints, energy bills and industry standards as actionable metrics to drive HVAC upgrades and replacements. All of which amounts to less-than-educated guesses and utilizes risk aversion as a basis for investment – And nobody like spending money on insurance!

So how do you accurately budget equipment replacements without risking tenant comfort or usable life? Start by evaluating investments based on the two most commonly used metrics – Risk and return. If you pair real-time equipment forecasting and tracking to traditional replacement methodologies you can increase equipment life 12-15%, mitigate risk of failure, and guarantee savings.

Understanding HVAC operating costs starts with tracking and forecasting operating costs over time, yielding operating degradation.

 

Measuring HVAC operating degradation over time.

Example – 1: As your equipment ages over time it begins to degrade in total operating costs like maintenance and energy. Degradation forces operating costs to exceed equipment value over time, inducing owners to upgrade units and measure impact on how it curbs operating costs.

In Example – 1 we see that as equipment ages over time it degrades to the point were operating costs like maintenance and energy surpass Replacement Asset Value (RAV). When managers can see degradation in real-time, they can decide when to proactively invest in upgrading units and measure success based on how much operating cost degradation is curbed post-project.

DegradationROI

Example – 2: As operating cost degradation exceeds asset value over time we find that a replacement Return on Investment (ROI) can be tracked. If we invest in equipment and see no change to the ROI we know the next actionable step is to replace the equipment.

What happens when you upgrade a unit with a VFD, or replace a valve, and there is no measurable effect to degradation? Further exploring equipment degradation in Example – 2 shows us that once operating costs surpass Replacement Asset Value (RAV) a Replacement Return on Investment (RROI) is revealed. If real-time ROI isn’t impacted by equipment upgrades, it’s a good indication the unit has aged should be replaced.

Forecasting and tracking equipment costs like energy and maintenance are essential to understanding how effectively you invest in HVAC – From basic maintenance to capital replacements. Without adequate risk and return data you could be replacing equipment too early and upgrading too late, all of which is impacting your bottom line and tenants! 

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’re an HVAC engineering firm that utilizes cloud-based technology to bridge the technical and financial gaps commonly found in HVAC management. Our OCMS EnerVise platform keeps customers knowledgeable about their building including HVAC life-cycle costs, forecasted maintenance & upgrades, and equipment replacements.   You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

OCMS; Building Operating Cost Management

Three ideas property managers can use to drive sustainability in their buildings – Without spending a fortune!

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Discover new ideas to drive sustainability in your building without spending a fortune.

Property managers have more knowledge than they might be aware of to greatly reduce building operating costs without tapping into capital reserves.

Try these steps to reduce energy consumption in your building and better control operating costs

By: Zach Denning

 

Large commercial real estate companies typically have sustainability and engineering divisions tasked with finding building inefficiencies throughout their commercial portfolios. When we think building sustainability, our minds drift to sophisticated solutions involving key stakeholders and large capital budgets. Yet, when it comes to HVAC, it may be easier than you think to drive down energy and maintenance costs with little capital.

There’s one person that knows the building and it’s issues better than anyone – The property manager. 6/10 tenant issues reported to property managers are HVAC related – 60% of all energy in a commercial building goes to the HVAC… Spotting a trend?

Property managers have more power than they think to solve key tenant issues and reduce operating costs like maintenance and energy. All it takes is applying some new ideas on how to manage HVAC:

 

1. Track maintenance costs down to the equipment level to maximize equipment life and decrease operating costs

Maintenance is usually tracked as an annual lump sum with the Preventative Maintenance (PM) contract broken out. Like most analytics, lump sum only tells us that you’re spending more or           less – Not where, how or why you’re spending your money.

If you track maintenance costs at the equipment level (valve replacements, filter replacements, etc.), the resulting annualized figure can be used to reveal operating degradation. Dividing annual maintenance costs by total replacement value gives you an indication of equipment Return on Investment (ROI) from a maintenance perspective. A resulting ROI of 0.15 or lower indicates your equipment is working efficiently while 0.3-0.4 tells you it’s time to replace.

Driving equipment replacements from maintenance degradation extends life 10-15%, reduces emergency replacement costs 20-30% and often leads to lower energy costs from increased efficiency.

 

2. Utilize emerging building technologies to forecast and repair failures before they impact tenants and bills

There are a few new building technology services capable of tapping into your buildings HVAC and finding potential failures before they occur – Some even go as far to quantify the issue real-time for easy repair prioritization.

Forecasted maintenance services are typically subscription based, granting managers the flexibility to evaluate cost savings without large capital expenditures. Systems should evaluate issues from a financial perspective allowing managers to acclimate new, actionable data into their workflows without needing a strong technical background.

Finding and repairing issues before the equipment fails not only alleviates the potential risk of failure and tenant impact, it reduces maintenance costs 25-35% and increases equipment efficiency 15-20%.

 

3. Take control of HVAC operation with periodic building automation tune-ups to increase efficiency

50-60% of HVAC related tenant calls in commercial buildings are building automation related. Preventative Maintenance (PM) contracts often fail to identify and remedy automation inefficiencies before they impact your tenants and your energy bills.

Typical issues like hot/cold calls and “doors blowing open” often refer to the controllability of the Building Management System (BMS). Having a controls contractor or consultant audit your system and tune up programming periodically throughout the year can often solve the major issues your tenants have discovered.

Fixing simplistic automation issues often result in 10-15% savings, payback in less than 8-months and extended equipment life.

 

The above recommendations have a proven track record of great payback (<8-months average) and can be easily implemented by property managers – Without needing to brush up on technical skills.

Try them out today and feel free to leave comments on how well they’ve worked for your organization!

 

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’re an HVAC engineering firm that utilizes cloud-based technology to bridge the technical and financial gaps commonly found in HVAC management. Our OCMS EnerVise platform keeps customers knowledgeable about their building including HVAC life-cycle costs, forecasted maintenance & upgrades, and equipment replacements.   You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

OCMS; Building Operating Cost Management

Hot & cold calls ruining your tenant relationships? Learn a new management style to reverse calls and costs without becoming an expert!

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You don’t need to be an HVAC expert to make impactful, financially-driven decisions!

By: Zach Denning

Do your tenants complain about temperature issues? Find yourself explaining how bad your HVAC is? Tenant complaints are the result of reactive HVAC management. Proactive management techniques have proven to reduce tenant calls 50% while curbing operating costs 15-20%.

Do your tenants complain about temperature issues? Find yourself explaining how bad your HVAC is? Tenant complaints are the result of reactive HVAC management. Proactive management techniques have proven to reduce tenant calls 50% while curbing operating costs 15-20%.

 

It’s no secret that the majority of tenant complaints in commercial buildings revolve around HVAC. Hot and cold calls make up 8/10 objections lodged by tenants and are the catalyst for declining relationships between tenants and managers. Most tenants may not leave over a few degrees of comfort, but mounting HVAC issues may cause a tenant to look elsewhere before resigning a lease. Let’s face it, when the majority of workers are strapped to an office half of their lives they have every right to be comfortable.

Most managers have come to live with under-performing HVAC – In fact some even forewarn tenants to help manage expectations! So why do we accept status quo when it comes to comfort? Do you know how badly temperature control issues actually affect your tenant? Numerous case studies have cited that even 2-3 degree temperature swings from comfortable conditions ( > 68 or < 72) show 5-7% reduction per degree in productivity. Your losing almost 20% of your bottom line when your office is 76 degrees in the summer!

One of the biggest problems surrounding tenant complaints is reactive management styles.  Yet, it’s not the fault of the owner or property manager. The typical manager has two analytics to derive actionable, financial intelligence – Lump sum, annual energy and maintenance bills. Other than that, they’re service provider is feeding them technically based, End-of-Life (EOL) reports detailing which component or equipment is going to fail next. Building owners typically react to risk aversion or investments – Which neither lump-sum bill analyzation or technical reports deliver!

So how do we command meaningful change? How do we reverse traditional mentalities and avoid having to deliver sub-par comfort? Proactive management. We’ve all heard the term deferred maintenance. Some like to be politically correct and call it an annual budget. What we don’t consider when we put off maintenance, irregardless the reasoning, is the associated risk and cost of efficiency. Equipment costs more money to run when there are lingering component problems. Would you have replaced that air filter in your car if your mechanic told you it would cost you $0.10/mile? How about those bald tires? If he told you there was a 50% chance of wrecking your car and you’d spend $150.00 in the next 1,000 miles, you’d probably be more inclined to shell out!

The reality is that uncalculated risk and returns are never enough to get us to spend our money. We hold it tight to our chests. We spend it either to make more or to prevent losing less. That’s it. HVAC expenditures fall under the same principles. If we’re able to weigh every potential repair, upgrade, and replacement against how much we’re losing daily, or the calculated risk impact to tenants, we now have a reason to invest in temperature control. By understanding how every HVAC expenditure impacts our bottom line, we forego replacements because they either don’t cost us enough or they won’t have an impact on our tenant. We spend money because we’ll either lose more running the equipment versus replacing or the equipment failing will cause a complaint.

Proactive management is about understanding how each investment we make from a preventative maintenance contract to an energy retrofit will impact our bottom line. Versus traditional preventative maintenance, proactive strategies:

  • Save about 30-40% in maintenance costs by reducing emergency repairs
  • Drive down tenant complaints almost 50%
  • Increase energy savings 20-25%

HVAC sustainability is not always in how much energy you save. It’s about understanding equipment costs and driving maintenance and energy efficiency based on impact to the bottom line. If we can forecast life-cycle costs, we understand how much it’s costing us to not replace equipment, or not repair a component, irregardless of technical understanding. Proactive management techniques will drastically improve your relationship with key financial stakeholders, as you turn the cost-impact of HVAC into an investment while reducing tenant calls and operating costs.

 

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’re an HVAC engineering firm that utilizes cloud-based technology to bridge the technical and financial gaps commonly found in HVAC management strategies. Our OCMS EnerVise platform keeps customers knowledgeable about their building from life-cycle costs to forecasted maintenance, upgrades, and equipment replacements.   You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

OCMS; Building Operating Cost Management

Your HVAC sustainability plan might not be sustainable

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Evaluating risk in HVAC sustainability initiatives isn’t as simple as you think!

Ever wondered how to measure your sustainability initiative? What if your utilities don't show savings?

Ever wondered how to measure your sustainability initiative? What if your utilities don’t show savings? Could it be problems with your HVAC?

By: Zach Denning

 

Hiring an Energy Services Contractor or ESCO is typically the first step towards achieving your sustainability goals. In a commercial building they evaluate energy consumption and recommend potential upgrades with quantifiable payback – Often times leading to low-risk investments that drive the value of the property and guarantee savings – Well, at least for the first year.

In commercial buildings HVAC has historically consumed 50% of your utilities, or around $1-3.00 per square foot annually in energy costs, making it a prime target for savings. Owners and tenants typically invest $2-3.00 per square to drive down HVAC related costs under the impression of a 2-4 year payback – That’s $100-150k in a 50k sq. ft. building and almost $6k in estimated monthly savings! But do you know how those savings are broken down? Or were the lump sum savings and payback enough for you to make the investment?

A recent interview with asset managers regarding their sustainability initiatives revealed several inconsistencies with how they evaluated and approved their investments in utility savings. Reviewing initial contracts and line itemizing HVAC returns exposed that the majority of their savings centered around controllability of the equipment – Not high-cost replacements or upgrades. Although modifications to the existing building technology or “temperature cruise-control” yielded more than half of their estimated returns, it also came with the highest amount of neglected risk!

If I buy a brand new Toyota Camry that’s expected to get 35 mpg on the freeway and take away the cruise control I may be lucky to get 25 mpg on my way to work. Building automation, or your building’s “cruise-control,” is the leading cause of return impact and risk in sustainability projects. In our $150k investment above, nearly $40k of the annual savings are driven from the building automation. Breaking down the different building automation measures reveals that on average each measure makes up 7-10% of your total returns! So why would the technology be considered a risk?

Servicing HVAC and its related technology can be a challenge after implementing sustainability-based projects. Control of the HVAC equipment becomes complex. Incorporating more advanced algorithms to properly measure and control to the load in your building – No longer does the HVAC just turn on and off. The same way cruise-control in your car adjusts the throttle up and down to account for hills, HVAC ramps up and down to account for loads like weather and occupancy.

When servicing these newer, ASHRAE Title-24 and LEED based systems, technicians can find themselves overwhelmed and unable to decipher the new algorithms when challenged with solving an HVAC related issue. If a door consistently blows open the fix is not as simple as flipping a switch. Reverse engineering code to predict and repair a problem is often replaced with local, physical overrides or even worse software-lockout of routines – All leading to substantial, untraceable losses in your return.

Maintaining HVAC-related investments is much different than maintaining the actual equipment. Owners and tenants are beginning to realize that more advanced monitoring is necessary to ensure savings and forecast problems before they impact the bottom-line. Traditional preventative maintenance contracts in building technology and HVAC equipment are necessary, although their primary function is not to evaluate, forecast and repair problems as they relate to your investment. The shift to financial-based HVAC management is leading building owners to find more technological ways to measure equipment performance real-time, in order to forecast repairs and curb losses.

My name is Zach Denning and I’m the CEO and owner of EnerDapt, Inc. We’re an HVAC engineering firm that utilizes cloud-based technology to bridge the technical and financial gaps commonly found in HVAC management strategies. Our OCMS EnerVise platform keeps customers knowledgeable about their building from life-cycle costs to forecasted maintenance, upgrades, and equipment replacements.   You can reach me at zdenning@enerdapt.com or visit our website at www.enerdapt.com

OCMS; Building Operating Cost Management